The Minnesota Legislature has been looking at a bill for $100 million for broadband development. Yesterday I attended the most recent meeting on the issue in the House (Ways & Means meeting – the bill has been rolled into HF 2976 and we just heard the first engrossment). On the very high level – the House is suggesting $25 million (not the original $100 million) for broadband development to be doled out as grants through a process managed by the Office of Broadband Development. They are also suggesting $450,000 for mapping and research and $250,000 for general funding for the Office of Broadband Development.
There are some details in the proposed legislation that indicate that some areas will be better poised than others to get the funding. I’ve tried to distill the information into a few questions you might ask yourself to see where your community sits.
- Is your community unserved? The definition they provide is having access to the Internet at speeds of 4 Mbps downstream and 1 Mbps up. Priority will be given to unserved areas.
- Is your community underserved? The definition they provide is having access to broadband at speeds of 10-20 Mbps downstream and 5-10 Mbps up. Priority may be given to underserved areas.
- Are you looking at infrastructure that can be scaled to 100 Mbps speeds?
- Are you in an economically distressed area?
- Can you serve more people who are currently unserved or underserved and/or can you leverage the grants to get greater funds from private or public sources?
- What is the population density of your area? Two thirds of the funds will target areas where household density is less than 100 households per square. One third of the funds will target areas where household density exceeds 100 households per square mile. (This approach opens the door to areas with greater population density.)
For the most interested, I thought it might be helpful to present a Cliff Notes type introduction to the proposed bill. The Blandin Foundation is planning a webinar on the topic as for next Friday afternoon. I will post more information as it becomes available.
To be fair I have not combed through the Senate version of the bill. I will try to do that over the weekend with an eye to anything different from the House version.
You can find one of the latest versions of the proposed bill online – I’m going to try to parse it out…
2.11 Subd. 2. Business and Community
2.12 Development 0 36,250,000
2.13 (a) $25,000,000 in fiscal year 2015 is for
2.14 grants for the development of broadband
2.15 infrastructure under Minnesota Statutes,
2.16 section 116J.395, or to supplement revenues
2.17 raised by bonds sold by local units of
2.18 government for broadband infrastructure
2.19 development. This is a onetime appropriation
2.20 and is available until June 30, 2017.
It looks like $100 million has slipped to $25 million.
2.21 (b) $450,000 in fiscal year 2015 is from the
2.22 general fund for one or more contracts with
2.23 an independent organization to continue to:
2.24 (1) collect broadband deployment data from
2.25 Minnesota providers, verify its accuracy
2.26 through on-the-ground testing, and create
2.27 state and county maps available to the public
2.28 showing the availability of broadband service
2.29 at various upload and download speeds
2.30 throughout Minnesota, in order to measure
2.31 progress in achieving the state’s broadband
2.32 goals established in Minnesota Statutes,
2.33 section 237.012;
3.1 (2) analyze the deployment data collected to
3.2 help inform future investments in broadband
3.3 infrastructure; and
3.4 (3) conduct business and residential surveys
3.5 that measure broadband adoption and use in
3.6 the state.
3.7 Data provided by a broadband provider to the
3.8 contractor under this paragraph is nonpublic
3.9 data under Minnesota Statutes, section 13.02,
3.10 subdivision 9. Maps produced under this
3.11 paragraph are public data under Minnesota
3.12 Statutes, section 13.03.
There is funding for on mapping. This is the work that has previously been done my Connect Minnesota. Connect Minnesota is not named in the legislation. The work sounds quite similar to what they have been doing. The door is open to multiple contractors.
[Side note – there are also a number of $1,000,000 funds slated for the initiative foundations that may be helpful to rural businesses in the forms of revolving loans; they are not necessarily for broadband but perhaps would be used by local businesses to implement applications and training or deployment equipment and infrastructure.]
13.3 (o) $250,000 each year is from the general
13.4 fund for the Broadband Development Office.
It looks as if this is funding for general operations more than any fund that might get passed onto communities.
So far the proposal is pretty straight forward – funding for broadband deployment, mapping and the Office of Broadband Development. There is a special section on the broadband fund. I’m going to go a little out of order – because I think it’s easier to look at high level before going to the detail.
16.27 Sec. 2. [116J.395] BORDER-TO-BORDER BROADBAND DEVELOPMENT
16.28 GRANT PROGRAM.
16.29 Subdivision 1. Establishment. A grant program is established under the Department
16.30 of Employment and Economic Development to award grants to eligible applicants in order
16.31 to promote the expansion of access to broadband service in unserved or underserved
16.32 areas of the state.
Grants are established to expand broadband..
16.33 Subd. 2. Eligible expenditures. Grants may be awarded under this section to fund
16.34 the acquisition and installation of middle-mile and last-mile infrastructure that support
Funding is only available for middle and last-mile infrastructure. This means (as pointed out in definitions below) infrastructure that goes from the broadband service provider to last mile (so maybe from a main office to a node in a neighborhood) and/or infrastructure that reaches the end customer.
Article 2 Sec. 2. 16HF2976 COMMITTEE ENGROSSMENT REVISOR JC CEH2976-1
17.1 broadband service scalable to speeds of at least 100 megabits per second download and
17.2 100 megabits per second upload.
The infrastructure must be capable of serving broadband at higher speeds (100 Mbps) – that doesn’t mean serve those speeds tomorrow but this is an attempt to future proof the infrastructure and implies that the infrastructure should weather the test of time.
17.3 Subd. 3. Eligible applicants. Eligible applicants for grants awarded under this
17.4 section include:
17.5 (1) an incorporated business or a partnership;
17.6 (2) a political subdivision;
17.7 (3) an Indian tribe;
17.8 (4) a Minnesota nonprofit organization organized under chapter 317A;
17.9 (5) a Minnesota cooperative association organized under chapter 308A or 308B; and
17.10 (6) a Minnesota limited liability corporation organized under chapter 322B for the
17.11 purpose of expanding broadband access.
The funds are available to wide range of entities.
17.12 Subd. 4. Application process. An eligible applicant must submit an application
17.13 to the commissioner on a form prescribed by the commissioner. The commissioner shall
17.14 develop administrative procedures governing the application and grant award process.
17.15 The commissioner shall act as fiscal agent for the grant program and shall be responsible
17.16 for receiving and reviewing grant applications and awarding grants under this section.
17.17 Subd. 5. Application contents. An applicant for a grant under this section shall
17.18 provide the following information on the application:
17.19 (1) the location of the project;
17.20 (2) the kind and amount of broadband infrastructure to be purchased for the project;
17.21 (3) evidence regarding the unserved or underserved nature of the community in
17.22 which the project is to be located;
17.23 (4) the number of households passed that will have access to broadband service as a
17.24 result of the project, or whose broadband service will be upgraded as a result of the project;
17.25 (5) significant community institutions that will benefit from the proposed project;
17.26 (6) evidence of community support for the project;
17.27 (7) the total cost of the project;
17.28 (8) sources of funding or in-kind contributions for the project that will supplement
17.29 any grant award; and
17.30 (9) any additional information requested by the commissioner.
This section outlines the grant proposal forms, which I suspect also indicates qualifications for proposals – such as location, current broadband situation and houses/anchor institutions served. They also are looking for community support.
17.31 Subd. 6. Awarding grants. (a) In evaluating applications and awarding grants, the
17.32 commissioner shall give priority to applications that are constructed in areas identified by
17.33 the director of the Office of Broadband Development as unserved.
17.34 (b) In evaluating applications and awarding grants, the commissioner may give
17.35 priority to applications that:
18.1 (1) are constructed in areas identified by the director of the Office of Broadband
18.2 Development as underserved;
18.3 (2) offer new or substantially upgraded broadband service to important community
18.4 institutions including, but not limited to, libraries, educational institutions, public safety
18.5 facilities, and healthcare facilities;
18.6 (3) facilitate the use of telemedicine and electronic health records;
18.7 (4) serve economically distressed areas of the state, as measured by indices of
18.8 unemployment, poverty, or population loss that are significantly greater than the statewide
18.10 (5) provide technical support and train residents, businesses, and institutions in the
18.11 community served by the project to utilize broadband service;
18.12 (6) include a component to actively promote the adoption of the newly available
18.13 broadband services in the community;
18.14 (7) provide evidence of strong support for the project from citizens, government,
18.15 businesses, and institutions in the community;
18.16 (8) provide access to broadband service to a greater number of unserved or
18.17 underserved households and businesses; or
18.18 (9) leverage greater amounts of funding for the project from other private and
18.19 public sources.
18.20 (c) The commissioner shall endeavor to award grants under this section to qualified
18.21 applicants in all regions of the state.
Priority will be given to unserved areas – as defined as having access to the Internet at speeds of 4 Mbps downstream and 1 Mbps up. This is the federal definition of broadband.
Priority may be given to areas that are:
- Unserved – as defined as having access to the Internet at speeds of 10-20 Mbps downstream and 5-10 Mbps up. That is Minnesota’s goal broadband access in 2015.
- In economically distressed areas
- Looking to connect anchor tenants
- Looking at telemedicine and electronic health records
- Looking to encourage adoption through tech support, training and public promotion
- Are able to serve the greatest number of currently unserved and underserved people OR are able to leverage the greatest funds from private and other public sources
18.22 EFFECTIVE DATE. This section is effective the day following final enactment.
18.23 Sec. 3. [116J.396] BORDER-TO-BORDER BROADBAND FUND.
18.24 Subdivision 1. Account established. The border-to-border broadband fund account
18.25 is established as a separate account in the special revenue fund in the state treasury. The
18.26 commissioner shall credit to the account appropriations and transfers to the account.
18.27 Earnings, such as interest, dividends, and any other earnings arising from assets of the
18.28 account, must be credited to the account. Funds remaining in the account at the end of a
18.29 fiscal year are not canceled to the general fund, but remain in the account until expended.
18.30 The commissioner shall manage the account.
The funds will be available immediately after enactment. Funds not disbursed will remain in account until expended.
18.31 Subd. 2. Expenditures. Money in the account may be used only:
18.32 (1) for grant awards made under section 116J.395, including up to three percent of
19.1 (2) to supplement revenues raised by bonds sold by local units of government for
19.2 broadband infrastructure development.
19.3 Subd. 3. Restrictions. (a) Except as provided in paragraph (c), in any fiscal year, no
19.4 more than one-third of the funds expended from the account established in this section
19.5 shall be awarded to applicants located in areas whose household density exceeds 100
19.6 households per square mile, as determined by the state demographer.
19.7 (b) Except as provided in paragraph (c), in any fiscal year, no more than two-thirds
19.8 of the funds expended from the account established in this section shall be awarded to
19.9 applicants located in areas whose household density is less than 100 households per square
19.10 mile, as determined by the state demographer.
19.11 (c) If applications are insufficient to exhaust all funds available in a given grant
19.12 round under the restrictions imposed in paragraph (a) or (b), the unexpended funds may
19.13 be awarded to eligible applicants, as determined by the commissioner, irrespective of the
19.14 population density of the area in which the applicant is located.
19.15 Subd. 4. Appropriation. Money in the account is appropriated to the commissioner
19.16 for the purposes of subdivision 2.
19.17 EFFECTIVE DATE. This section is effective the day following final enactment
18.33 the total amount appropriated for grants awarded under that section for costs incurred by
18.34 the Department of Employment and Economic Development to administer that section; or
No more than one third of the funds will go to areas where household density exceeds 100 households per square mile, as determined by the state demographer. No more than two thirds of the funds will go to areas where household density is less than 100 households per square.
It’s important to look at some of the definitions in the bill too. It’s akin to reading the eligibility qualifications for a request for grant proposal. Below are the definitions outlines in the bill – I’ve tried to place and discuss them above with the appropriate section of the bill…
16.6 (b) “Broadband” or “broadband service” has the meaning given in section 116J.39,
16.7 subdivision 1, paragraph (b).
16.8 (c) “Broadband infrastructure” means networks of deployed telecommunications
16.9 equipment and technologies necessary to provide high-speed Internet access and other
16.10 advanced telecommunications services for end users.
16.11 (d) “Commissioner” means the commissioner of employment and economic
16.13 (e) “Last-mile infrastructure” means broadband infrastructure that serves as the
16.14 final leg connecting the broadband service provider’s network to the end-use customer’s
16.15 on-premises telecommunications equipment.
16.16 (f) “Middle-mile infrastructure” means broadband infrastructure that links a
16.17 broadband service provider’s core network infrastructure to last-mile infrastructure.
16.18 (g) “Political subdivision” means any county, city, town, school district, special
16.19 district or other political subdivision, or public corporation.
16.20 (h) “Underserved areas” means areas of Minnesota in which households or businesses
16.21 lack access to wire-line broadband service at speeds that meet the state broadband goals of
16.22 ten to 20 megabits per second download and five to ten megabits per second upload.
16.23 (i) “Unserved areas” means areas of Minnesota in which households or businesses
16.24 lack access to wire-line broadband service at speeds that meet a Federal Communications
16.25 Commission threshold of four megabits per second download and one megabit per second